Effective loan capital "stimulates" household economy

(Baonghean) - With timely support from credit institutions, many households, especially in rural areas, have capital to invest in production and business. The loans are being used effectively in crop and livestock models that provide stable income in rural areas.

Understanding the needs of rural people in borrowing capital to invest in developing household economy, credit institutions have actively supported. Mr. Pham Huy in village 1, Dien Ky commune - Dien Chau said: "My family has been trading iron, steel and scrap since 1998 and at that time, Dien Chau Agricultural and Rural Development Bank lent 5 million VND. From that source of capital, it has greatly supported the family in doing business and developing on a large scale.

Currently, the facility creates stable jobs for 15 local workers, while developing a network of goods collection in the provinces of Quang Binh, Ha Tinh, Thanh Hoa... exporting more than 35 tons of scrap steel to steel companies every day". The scale of production and business is large but the location is right at the house, affecting the residential area. Therefore, Mr. Pham Huy's family is planning to invest 14 billion VND to build a steel collection and processing facility in the Thap - Hong - Ky industrial cluster. After reviewing the loan conditions, the bank decided to lend 2.5 billion VND for this household economic model.

The capital for household economic development has helped many people in Dien Chau district invest in production and business models. Typically, in Dien Thang commune, 368 households borrowed nearly 9 billion VND to invest in fattening cows. Initially, each household raised 2-4 cows and after 3-4 months of fattening, they would sell them at a high price. Recently, people have begun to unite and form concentrated fattening cow groups (from 5-10 households) to support each other in developing livestock farming, while promptly helping households when they encounter risks in livestock farming. This approach brings practical benefits to people and ensures the safety of loan capital. Currently, the total outstanding loan balance for household economic development of the Dien Chau Bank for Agriculture and Rural Development has reached 898 billion VND and there have been 9,433 households borrowing capital, of which 40% of households borrowed capital to invest in livestock development, 20% of households invested in developing other industries...

Ms. Ngo Thi Ha, Deputy Director of Dien Chau Agricultural and Rural Development Bank, said: “In order to promptly meet the capital source for people to invest in production and business development, the bank always cares, supports and manages customers well, thereby correctly assessing the capacity of customers to invest in reasonable loans. In particular, one of the methods highly appreciated by people is that the bank applies the lending method according to the credit limit, so the capital is quickly disbursed, helping customers take advantage of production and business opportunities.”

Chicken farming model in Dien Trung commune (Dien Chau).

Yen Thanh district has 21/39 communes and towns in semi-mountainous and mountainous areas. In recent times, the district's Agricultural and Rural Development Bank has focused on prioritizing capital for household economy to invest in production development and livestock farming to exploit this advantage. In Dong Thanh commune, there are 800 households borrowing to invest in livestock farming and service development with outstanding loans of 45 billion VND, of which 300 households borrowed capital to invest in livestock farming development, 250 households invested in forest planting and many households invested in developing industries and services. A typical example is Mr. Pham Van Cuong's family (Dong Long hamlet), who borrowed capital from the bank to invest in buying 5 cars for passenger transport business... In Tan Thanh commune, the outstanding loan in the household economy sector is 44 billion VND; Phu Thanh 42 billion VND, Do Thanh 37 billion VND...

Taking advantage of forest land, many families in Thanh Chuong district have borrowed capital to invest in developing economic models of forest plantation and livestock farming. The district's Agricultural and Rural Development Bank has mobilized capital, promptly meeting the demand for loans for households to invest in farms and hill gardens with nearly 7.3 billion VND. Most of the households borrowing capital in Thanh Chuong have been effective. Mr. Nguyen Van Loi's family, in Phuong Dinh hamlet, Dong Van commune, borrowed 2.9 billion VND with their own capital to invest in a comprehensive livestock farming model (raising sows, pigs, eels, fish). Every year, Mr. Loi's family earns more than 4 billion VND in revenue. Or like Mr. Tran Huu Tap's family, in Suon hamlet, belonging to Thanh Chuong Tea Enterprise, with family savings and a bank loan of 300 million VND, planted 42.5 hectares of tea, oranges, forestry trees, etc.

Investing in household economic development is one of the core activities of the Bank for Agriculture and Rural Development and this is a very timely and effective capital support channel for people in localities. Ms. Dang Thi Chung, Head of Service & Marketing Department of the Bank for Agriculture and Rural Development of Vietnam - Nghe An Branch said: "Currently, in the province, there are 139,148 households that have received loans to invest in production and business development and make good use of loan capital.

However, in the process of implementing household economic loans, due to the large area, many households have borrowing needs and most of the loans are small, so it is difficult to manage outstanding debts. Especially in mountainous districts and particularly difficult areas, some people's awareness is not high in complying with the loan process and procedures, using capital... Therefore, in the coming time, along with developing capital sources for household economic loans, banks will focus on propaganda and mobilizing people to boldly borrow capital to invest in production development, at the same time, bank staff will directly guide people to establish loan procedures, use capital effectively and comply with capital repayment regulations...".

In addition to the Bank for Agriculture and Rural Development, the Vietnam Bank for Social Policies - Nghe An Branch is also an organization that provides loans to thousands of households to develop production and business effectively with outstanding loans of 4,293 billion VND, of which 852 billion VND was in the first 6 months of 2015. Investment in capital for household economy has been promptly implemented by credit organizations in the province, helping people to improve production and business effectively and actively contributing to hunger eradication and poverty reduction, job creation, and new rural construction...

Hoang Vinh